Clean Biologics

Clean Biologics began as a Contract Testing Development and Manufacturing Organisation (CDTMO), following the strategic acquisition of Clean Cells by ArchiMed in 2018. Clean Cells was a Quality Control (QC) testing business. The expansion continued with the acquisitions of Biodextris and Naobios, further strengthening the group’s capabilities in the biopharmaceutical sector. The company was part of ArchiMed’s second fund, MED II. Over a five-year period, Clean Biologics experienced significant growth, surpassing its original business projections by tripling both its revenue and EBITDA.

The business operates in a large market (c. US$5.4bn) experiencing favourable commercial and regulatory tailwinds for structural growth (13% CAGR expected) driven by increased biopharma spending on clinical trials and R&D and increased regulatory scrutiny supporting QC testing.

Clean Biologics provides industry-compliant services to pharmaceutical and biopharmaceutical companies, with a focus on the safety and production of biopharmaceuticals for clinical trials. The company’s growth strategy involved leveraging ArchiMed’s MedTalent network and exploring opportunities with trade buyers. This proactive approach led to the identification of numerous avenues for further value creation. As a result, ArchiMed decided to transition Clean Biologics into a continuation vehicle, aiming to sustain and enhance the company’s growth trajectory.

Through engagement with a number of trade buyers, ArchiMed concluded that exit optionality and value would be maximised by splitting Clean Biologics into two distinct businesses focused on drug quality control testing and CDMO services, respectively. The businesses have differentiated offerings: Clean Cells is one of the few remaining independent QC testing providers with differentiated scientific capabilities (in traditional as well as Next Generation Sequencing based QC testing services); Biodextris has differentiated expertise in the production of niche therapeutic proteins. 
 

PPET took the opportunity to back ArchiMed, a high conviction manager, on a transaction in their sector sweet spot where they have significant experience, track record of returns and strong trade buyer relationships.

The timing of the investment was considered attractive, benefiting from recent capex and improving market sentiment/forward pipeline visibility. The investment coincided with early signs of recovery in global biopharma spending on clinical trials, after a challenging period, with the companies positioned to benefit from the material investment made in capacity expansion in recent years.